We need more ‘non-working marketing spend’, not less


There are many phrases to which I take exception. I hate dead metaphors such as “Achilles’ heel”. I hate euphemisms that are designed to disguise their true meaning, such as “collateral damage”. And I hate out-and-out lies such as “we will give the £350m we save from the European Union to the NHS”.

But one of the most odious phrases in the English language is “non-working marketing spend”. It is disrespectful and disingenuous, and the time has come for sane-thinking marketing people to challenge it at every opportunity.

An insidious import from the US, “non-working marketing spend” has become a favoured phrase of analysts and investors. The big accountancies have even set out ideal ratios of working to non-working spend.

And, as a result, any number of chief executives and chief financial officers have started falling over themselves to show they have eradicated these seemingly indulgent costs from their businesses.

For them, marketing expenditure that is “working” is the money spent on “activity” itself, the investment from which there can be a direct return. That, of course, sounds honourable and responsible but it disguises the fact that the laziest part of the marketing budget is the bit spent on media in its many incarnations.

And that is simply because you get what you pay for – nothing less and, sadly, nothing more. The truth is, the thing these slack-witted bean-counters call “non-working marketing expenditure” is the bit that actually creates the value and growth those businesses so desperately need.

It’s the spend that opens up new revenue streams and turns faltering ones around. It’s the spend that helps galvanise organisations around a new idea or direction. It’s the spend that co-ordinates and integrates the many efforts of the brand in the service of a common purpose.

But that doesn’t cut it with the accountants – oh, no. I assume the many millions spent paying people to create, nurture and manage business-building ideas seem like money down the drain. Ideas such as “Vorsprung durch Technik”, “The world’s favourite airline”, “The fourth emergency service”, “The ultimate driving machine”, “Every little helps”, “Campaign for real beauty”, “This girl can”… need I go on?

Of course, not every brand is being fuelled by a killer idea paid for by “non-working marketing spend”, but the point is that every brand should be.

And chief executives and chief financial officers would be well-advised against choking off the supply of these ideas to their businesses.

What the accountants call “non-working marketing spend” is, in fact, paying for marketers – client- and agency-side – to do their actual jobs and deliver growth for their brands and businesses. It is not a frivolous affectation – it is marketing.

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2 Replies to “We need more ‘non-working marketing spend’, not less”

  1. Could not agree more.
    This is the result (in part) of the obsession with targeting, tracking and accountability brought about by digital marketing in the last 10 years or so.

    This being said: For Christ also suffered once for sins, the righteous for the unrighteous…

    What I mean: advertising is an industry that often makes a bad name for itself and often does so in very “loud” and expensive way.
    As a result it exposes itself as the ideal target for budgetary cuts.

    Eventually, the Numbers/Money people think they are cutting the excessive retainers (just one example for arguments sake) that maybe too often end up in lavish parties, while in reality they are cutting the (increasingly) rare commercial genius.

    As any external point of view, it might be slightly superficial but it is the results of some real life observations, it tries to be one piece of the jigsaw.

  2. As a 25% bean-counter and 75% entrepreneur, I must add there is a place for both. Effective advertising has to generate income to pay for it, even if paying for it takes place before the income is generated. Brand development and maintenance on a broad scale requires more than just direct, income-producing advertising, but at what cost, and what return?

    My recommendation is for the ad agencies and marketing professionals to sell the value of indirect/brand-development advertising in terms of the effect it will have with and without it, beginning with Top Of Mind Awareness and Buyer Behavior matrices. Once the value has been determined, convince clients to hard-code the price to earn it, and when needed, remind them of the cost for not spending it.

    Advertising agencies are businesses too, and they don’t spend money on things that won’t generate a return either. Bean-counters don’t get paid to not spend money, they are paid to spend what makes money–show them the value, and they will spend the money to get it…at least this 25% one will.

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